Canadian Dollar Hits Four-Week High on Soft US CPI and Higher Oil

The Canadian Dollar (CAD) rose to a four-week high against the US Dollar (USD) on Tuesday, driven by two key factors: weaker-than-expected US Consumer Price Index (CPI) data and a surge in oil prices.

Soft US CPI data reduced expectations for further Federal Reserve rate hikes, weighing on the greenback. Meanwhile, crude oil prices climbed on escalating tensions in the Middle East, benefiting the commodity-linked Canadian currency.

The move marks a notable turnaround for CAD, which had been under pressure in recent weeks. Traders will now eye upcoming Canadian economic data for further direction.